The harm will be more political than economic

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The European Commission was claiming earlier yesterday that it had spotted that “green shoots” were emerging in Britain’s economy. Moody’s, it would appear, begs to differ.

The rating agency has given a damning assessment of the UK’s outlook, warning that the country will continue to languish economically and that this will hurt George Osborne’s ability to bring down a national debt that is headed above 96 per cent of GDP.

How damaging is its decision? The timing comes as a surprise – most analysts expected the agencies to wait until next month’s Budget before delivering their latest opinions on the UK